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Rupee depreciates against dollar for fifth straight session

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  • Rupee closes at 224.40 against dollar.
  • Local unit loses 0.01% against greenback.
  • It comes after forex reserves fell to four-year-low.

The Pakistani rupee Friday registered losses against the US dollar for the fifth straight session in the interbank market as the central bank-held foreign exchange reserves fell over 10% week-on-week.

The local unit closed at 224.40 against the greenback after losing 0.01% compared to Thursday’s close of 224.37, data released by the State Bank of Pakistan (SBP) showed.

The development comes after foreign exchange reserves held by the State Bank of Pakistan (SBP) plunged to an alarming level after falling 10.45% to a four-year low.

The foreign currency reserves held by the SBP were recorded at $6,714.9 million as of December 2, down $784 million compared with $7,825.7 on November 25, data released by the central bank showed.

The reserve crisis has raised fears that the country might not be able to meet its foreign debt payments, however, SBP Governor Jameel Ahmad believes that Pakistan can repay its debts.

In the latest episode of the SBP podcast series, Ahmad reiterated that all debt repayments were on track and that country’s foreign exchange reserves were expected to increase in the second half of the current fiscal year.

Commenting on the severity of the dollar crunch, the Ministry of Finance’s former adviser Dr Khaqan Hassan Najeeb, said that it was important to consider that Pakistan had only received $4 billion in the last five months (July-November 2022) — this was beside the rollover.

“The slow inflow of funds, heavy payments — including Sukuk payment — and a less than satisfactory financial account have all added pressure on the reserves which now barely cover a month and 10 days of import payment,” he stated.

But that’s not it as the International Monetary Fund’s (IMF) programme is also stalled after Pakistan did not meet the all requirements for the ninth review.

Finance Minister Ishaq Dar has constantly assured that the country will successfully complete the IMF programme. The country is in desperate need of external financing as the IMF’s review for the disbursement of its next tranche of funding has been delayed since September.

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Donald Lu visits Finance Minister Aurangzeb at the World Bank headquarters.

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Wednesday saw Minister for Finance and Revenue Muhammad Aurangzeb meet US Assistant Secretary of State for South and Central Asian Affairs Donald Lu and Principal Deputy Assistant Secretary Elizabeth Horst.

The finance minister briefed US officials on Pakistan’s reform plan at the World Bank. Meeting both delegations decided to improve bilateral ties.

Meeting topics included alternative energy, agriculture, climate, and tech industry. Boosting the Pakistan-US economic partnership was another finance ministry priority.

With US officials, Pakistan’s Finance Minister Muhammad Aurangzeb addressed IT, agriculture, and other business potential.

Pakistan would collaborate with the US International Development Finance Corporation and Exim Bank, according to Muhammad Aurangzeb.

His name is Donald Lu.
Over 30 years of US government service for Lu as a foreign service officer.

What Pakistan calls the “cipher” dispute involves the American official. The Pakistan Tehreek-e-Insaf (PTI) founder claimed that a supposed official letter between Washington and Islamabad proved his ousting as PM was a US conspiracy.

Washington has strongly refuted Khan’s allegations.

The State Department’s top South and Central Asia diplomat is Donald Lu, assistant secretary of state.

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Huge investment potential exists in the telecom and IT sectors. Shaza Fatima

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According to Shaza Fatima Khawaja, Minister of State for IT and Telecommunication, there are numerous investment prospects in Pakistan’s IT and telecom sectors.

She noted that the current administration is dedicated to fostering foreign investment in the nation, in line with the Prime Minister’s goal.

According to a news release, CEOs Wateen Adil Rashid and Muhammad Shahbaz Khan of Taavun (Pvt) Limited, who paid her a visit on Tuesday, spoke with Minister of State for IT and Telecommunication Shaza Fatima Khawaja.

She declared that the private sector would receive complete support because it is essential to growing our exports.

Regarding youngsters, she stated that they are our greatest asset and that efforts are being made to further their growth.

Sheikh Nahyan bin Mubarak Al Nahyan of the United Arab Emirates was thanked by Shaza Fatima for his particular interest in promoting additional investment in Pakistan’s telecom industry.

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WB pledges complete support for changes aimed at stabilizing Pakistan’s economy.

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Federal Minister for Finance and Revenue, Muhammad Aurangzeb, met with President of the World Bank Group, Ajay Banga, according to a press release from the ministry of finance here. During the meeting, the minister discussed Pakistan’s progress under the nine-month Standby Arrangement (SBA) program as well as ongoing reforms in priority areas of taxation, energy, and privatization.

According to the statement, the minister also extended an invitation to the president to visit Pakistan, and both parties acknowledged the necessity of a rolling 10-year country framework plan.

The minister also talked on safeguarding Pakistan’s eligibility for concessional funding and future project pipeline during a meeting with Masatsugu Asakawa, President of the Asian Development Bank (ADB).

The chief executive officer of the US International Development Finance Corporation (DFC), Scott Nathan, also met with the minister of finance.

They discussed during the conference how DFC may increase its investments in Pakistan after resolving unresolved conflicts in a cooperative manner.

According to the minister, the government is supporting creative financing strategies to maximize PPP potential and private sector participation.

According to the statement, he gave his word that the government will do everything in its power to assist investment projects by both foreign and local businesses in Pakistan.

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